The following is a transcript of an address given at the Acadian Business Banquet, Acadia University, on October 15, 2009.
Thank you, Matthew. And good evening, ladies and gentlemen. It is truly a great honour and pleasure to have been invited here to Acadia… to visit one of Canada’s premier Universities… located in one of the most beautiful parts of the country… in what I consider to be the best season of the year… Autumn.
As you may know, I come originally from New England… or what some call the “Boston…Red Sox States”. I grew up on the ocean in Ipswich, Massachusetts, not far from Gloucester… and one of the highlights of life there were the bi-annual dory races involving Ipswich, Gloucester and Lunenberg, Nova Scotia.
I can no longer recall who actually won any of those races… but I do recall that everybody had a very good time afterwards… and that New Englanders and Nova Scotians had a lot in common… including a mutual affinity for Keith’s India Pale Ale.
Now, I grew up in Ipswich…. but I actually went to high school in the interior of Maine… living on a campus that had a view of Mount Washington to the West… and a road out of town heading North… to Canada.
The school was pretty isolated… think of the movies “Cider House Rules”… or “The Shawshank Redemption”… and, other than hockey, skiing and studying, there wasn’t much to do. We didn’t have TV… we were allowed only one movie per week, shown in the gym… so we pretty much had to entertain ourselves.
And we were in rural Maine. This wasn’t Kennebunkport and its summer white house… this was the back woods… the only Bushes we ever saw were cans of Bush’s Baked Beans.
This made for a kind of local-grown Down East humour… called “Bert and I” stories…
Bert… was a mythic Maine rustic… sometimes a woodsman… and sometimes a fisherman. The humour was dry and ironic… and told in the local dialect.
I’ll give you an example:
There is one story that has Bert walking along a country road near the town of South Paris. A man driving a fancy car… with New York license plates… stops Bert and says “Excuse me, fella, but can you tell me how to get to Millonocket?”
Bert ponders this for a moment… rubs his chin… and tells the driver, “Well sir, take your next right, drive along for six miles…” But then his voice trails off, “No, no, that’s not it. Take a left up ahead, go about two miles, you’ll be in East Hebron… No, no, that won’t work either”.
“Hmm… turn around, go seven miles to Minot… then go right at the Congregational church… no, no, that’s not it, either”. “You know, mister, now that I think about it… you can’t get there from here”.
Now in Maine… that yarn was though to be “wicked funny”. The risk in telling it in Wolfville, of course, is that some things… like Digby scallops… freshly picked Annapolis Valley Apples or corn… or local humour… may lose something when transported any great distance!
The expression “can’t get there from here”… often describes business skepticism towards Corporate Social Responsibility and Sustainability… and it can also reflect a feeling many younger people have as they begin their work life journey… in today’s unsettled economic climate.
For the next several minutes I would like to provide my perspective regarding the absolute imperative for business, not just in Canada, but globally, to operate in a socially responsible, environmentally sustainable manner.
And in the second portion of my talk, I would like to impart some advice… that I hope might be of use to those of you embarking on employment in business… that might make your own careers more sustainable… and more rewarding.
Let me begin with Corporate Social Responsibility.
So what is Corporate Social Responsibility?
Well, there are a number of definitions out there, but the one I tend to use was developed by Canadian Business for Social Responsibility. It states that CSR “Is a company’s commitment to operating in an economically, socially and environmentally sustainable manner… while recognizing the interest of its stakeholders”.
CSR grew out of the concept of good Corporate Citizenship, as practiced by large multinational companies in the 1950’s and 1960’s. Companies were seeking the equivalent of a social license to operate outside their own borders and engaged in philanthropic and other activities to promote good will… and foster a positive image. Companies like IBM, GE, ICI and Texaco were strong practitioners.
However, in those days, many investors did not really support the good Corporate Citizen model. Indeed, there was a sizable body of thought, which was best articulated by University of Chicago economist Milton Friedman, who wrote that corporate largess of any kind, indeed anything beyond paying taxes and adhering to the letter of the law, was essentially picking the pockets of shareholders.
Friedman saw corporate giving by CEO’s as more of an ego trip than anything else… and cited the example of senior executives getting their pictures taken passing large checks… to their pet charities… using dollars that rightfully belonged to shareholders.
Over time, however, attitudes changed… and corporate citizenship became more accepted… and more strategic. Companies learned to align their philanthropic interests with their brand and their customers. Canada Post is actually a good example of this, with its focus of more than 30 years on literacy… including our Annual Santa Letter Writing campaign and, more recently, sponsorship of the CanSpell National Spelling Bee.
After all, the ability to read and write… is pretty central to Canada Post’s business.
Tim Horton’s and McDonald’s are other examples of companies that became more strategic in their approach during the same period.
Beginning with Earth Day in 1970… and accelerating with events like the Bophol Union Carbide disaster in 1984 and the Exxon Valdez spill in 1989… the public began to look beyond charitable giving and began to hold corporations more accountable for a broader range of their behaviours… including their impact on health… and the environment.
This shift -- which was really a shift in public expectation -- brought about a corporate response that was often called the “triple-bottom-line” approach -- sometimes codified as “Profit, People, Planet”. The environment came more to the fore… and the term “sustainability” first began to be used.
Often those efforts in those days were driven by public relations concerns… and the activity would be managed by the communications, public affairs, or marketing function within a company.
This was certainly true when I was at CAE… and at CIBC.
What has changed since 2000, of course, is a growing realization that the degradation of our environment is of a far greater magnitude than previously thought… and that climate change is real.
Obviously some of this awareness has been driven by the Kyoto process… and the phenomenal success of Al Gore’s filmed power-point lecture, “An Inconvenient Truth”.
But much of it has been driven by business self-interest.
Climate change, businesses are realizing, has the potential to drive huge financial liability -- unfunded liability –– and is now, more and more, considered a risk management issue… which gets the close attention of CFO’s… Auditors… and Board’s of Directors.
At CIBC, for example, CSR now reports directly into Risk Management – recognizing that there is a potential financial and reputational down side to missing CSR targets.
And there is hard evidence that a company’s CSR activities do matter to Canadians.
A 2008 Ipsos Reid survey found that 55% of Canadian consumers consciously buy a company’s product based on a belief that it is a good corporate citizen… and 52% have refused to buy a product for the same reason.
Canadians also say they would prefer to buy a product that is more environmentally friendly, by two-to-one. However, the majority say they will only pay a 5% premium for such products. So that creates a challenge for business. And according to a recent survey conducted by Wilfred Laurier University and the National Post… 84% of Canadian CEO’s believe that ethical behaviour… in all its forms… contributes to profitability.
What do these CEO’s see as the significant benefits of CSR? There are seven reasons cited in a recent paper prepared by Ron Knowles of St.Michael’s College at the U. of T:
CEO’s say they expect CSR to:
- Enhances reputation and brand
- Create competitive advantage
- Provide (or maintain) Access to markets and capital
- Risk reduction
- Lead to the attraction and retention of employees
- Produce Cost savings
- And forestall even more onerous regulation.
There is nothing airy-fairy about CSR in executive suites and corporate boardrooms anymore -- it is now about business advantage… and even business survival.
Let me use my own company, Canada Post, as an example.
Why would Canada Post want to get involved in CSR… and specifically, carbon and landfill reduction and community activities?
The reasons are several.
First, we are big and we are everywhere. We have Canada’s most recognized brand; we have 7,000 vehicles, the most in the country; we have more than 7,000 retail outlets and more than 20 sortation plants across the country.
Second, we are part of virtually everyone’s supply chain. Our carbon footprint… is their carbon footprint.
Third, our employees want us to do the right thing – to be socially and environmentally responsible. They tell us this in surveys and employee feed-back sessions.
And fourth, our shareholder, the government, is asking us to step up our efforts.
The good news at Canada Post is that we have been moving forward on the environmental front since the 1990’s…and have been working towards Kyoto targets since 2002. We are actually the only large business entity in Canada that is in a position to meet Kyoto targets in 2012… having reduced our carbon footprint 8% between 2002 and 2008 alone.
What we didn’t have at Canada Post until late 2007, however, was a coordinated strategic approach, led from the top.
Thanks to that strategy review in February, 2008, I was named SVP, CSR, reporting directly to the CEO… and to the Chair of a newly-formed CSR subcommittee of our Board. This created ownership and accountability.
My mandate was to devise a CSR more detailed strategy; set targets; monitor; and then report, both to the Board… and to the public, via an annual CSR document.
This creation of a c-suite position was unique not only for a Crown Corporation… but for any Canadian company at the time. It brought executive focus… and attention… that could not be ignored.
To operationalize CSR… we created a CSR Steering Committee, drawn from all aspects of the business. We drew up very specific targets, whether for emissions from vehicles and aircraft… or the introduction of new products like our environmentally friendly ExpressPost envelopes… or a 75% diversion target from landfills.
We also looked at our community and social programs… and determined that our greatest opportunity to make a real difference was in mental health. We started a Foundation… and raised over $1 million in the first year… through the sale of a special stamp… and the solicitation of donations in our retail outlets.
We also, as part of our Postal Transformation process… where we will spend several billion dollars renewing our aging infrastructure… decided to build new facilities to LEED standards… and to renew our fleet of vehicles with the objective of achieving far greater fuel efficiency and lower emissions. In 2010 alone we will spend $31 million on new vehicles.
We also, just two weeks ago, hosted the first ever CSR meeting for all Crown Corps with the intent of sharing success stories and hopefully accelerating CSR activities across an array of companies.
What has been the payoff for all of this?
Certainly it has been well received by our employees, especially our younger employees, who tell us in surveys that they are proud to be associated with a company that strives to do the right thing.
We also know from corporate customer councils that they applaud our efforts. And consumers certainly have taken to our new environmentally-friendly ExpressPost envelopes… which are replacing the plastic bubble-wrap version.
We have also won a number of awards for our CSR reporting… and have been named one of Canada’s 100 Best Places to Work… by McLean’s Magazine.
But the truth is, while we lead in some respects here in Canada… we are actually lagging many European Posts… much as many Canadian companies are lagging their European counterparts.
So my message is that making companies sustainable is not a nice to have – it is a business imperative. And while it is not too late to get going… the window is closing… and those companies that are slow to adapt… run the risk of finding themselves outside, freezing in the dark.
So I have spoken about making companies sustainable… but what about making you sustainable… in terms of employment and career?
I have been in the workforce for 40 years… much of that time working for CEO’s. While I don’t pretend to have a magic formula for corporate or career success, I do have some observations… seven in all… which I am happy to share and which I hope might be of some use, especially to those of you just embarking on your own careers. So her goes…
First, don’t be afraid to pick up and move to where the work or opportunity lies. I am sometimes astonished when North Americans tell me they could never leave their town or city… because they can’t imagine being somewhere else. The vast majority of us are the descendents of people who came here precisely because they had the imagination and courage to move towards opportunity… from Europe… India or China… Latin America or the Carribbean.
Some moved to mining towns… or to work in textile mills… others moved to forest industry towns… still others to fishing communities… and they typically came across the sea at great personal risk and sacrifice to make a better life for themselves and their families.
They were not timid people. Do not be timid or expect the world to come to you.
Having said that, my second point is don’t be afraid to stay where you are. This may sound like a contradiction of tip number one… but it really isn’t. With today’s technology… and with the right idea, product or service… it is possible today to achieve business success from just about anywhere. Who would have thought for example that the world’s largest retailer would be headquartered in Rogers, Arkansas? Well, Sam Walton thought it… and made it happen. Today, literally dozens of successful business operate in remote locations thanks to the internet… and delivery logistics provided by Fed Ex, UPS, Purolator… and of course Canada Post.
Example, includes Veseys, a Prince Edward Island seed company… that has used technology to become a leader in North America… and the Original Flag Store... founded in 1966 in Barrie, Ontario… a good year to get in the flag business, when you thought about it… and have leveraged the internet to become a Canadian Leader.
And the same formula works for services. A good friend of mine, David Moorcroft of Royal Bank, recently retired as head of communications there… moved away from Toronto… and established a successful cruise line advice service… all web based… and did so hundreds of kilometers from any ocean or sea!
My third tip… is pick your boss… or CEO… wisely. My observation is that people at the beginning of their careers are so anxious to just get a job… they don’t spend enough time gauging whether or not their boss is someone they would like to work for… or learn from.
As you may have seen from watching “The Office” on TV… or films like “The Devil Wears Prada”, the wrong boss can make life miserable.
So carry out some due diligence before signing up. A bad boss relationship is like a bad marriage… easy to get into; very hard to escape.
My fourth tip is to communicate bad news upwards… just as quickly as good news. This seam hard to do… and you need to have a good boss or CEO to make it work. But one of the pivotal moments in my career came in 1988… when I had just joined IBM Canada… to work for their newly-minted CEO, John Thompson. I was running communications… and we had provided John with some data that was materially wrong… and he had just passed it on to his boss in New York. I immediately went to him, and told him of the error… and apologized.
Instead of being angry, John thanked me effusively. “Bob, you have to understand that the greatest enemy of a CEO is getting bad news slowly… or not at all… because people are afraid of the consequences. I can get good news any time… but I need people around me to deliver negative news unvarnished… and as quickly as possible, so it can get fixed!”
Of course for this to actually work… see tip #3… pick your CEO wisely!
Tip number five? Do not over-estimate American management talent… or under-estimate your own.
Perhaps it is our inherent modesty… or maybe it comes from reading the Wall Street Journal or watching “Mad Men” on TV, but I find Canadians often have an inflated view of U.S. executive talent… and look at Canadian business as a kind of Junior A… or Triple A… version of the American business big leagues.
In my experience, Canadian management is at least equal in talent and ability to their U.S. counterparts… and often superior.
This is certainly true in banking and financial services. Pound for pound, Canadian banks are better managed than their American counterparts. Part of this reflects our superior regulatory regime, but much of it is that Canadian banks like Royal, Scotia and TD… are simply better managed, especially on the retail side.
And I think back to my IBM days. When I was with IBM World Trade in New York in the early 1980’s… there was no doubt in anyone’s mind that the Canadian executives we saw were head and shoulders above their international counterparts… and were at least as strong as the American executive team.
The proof of this came a decade later… when the wheels came off at IBM… and Lou Gerstner was brought in to salvage the company. He looked around… and saw that the only unit that was addressing the underlying business issues… was IBM Canada.
Gerstner therefore plucked a series of IBM Canada executives out of Canada… and placed them in key corporate roles… John Thompson as his right-hand man as vice-chair; Bill Etherington as head of marketing and sales world-wide; Khalil Barsom as head of IBM Europe, Africa and the Middle East.
When asked why the Canadians did so well, Thompson later said “It wasn’t because we were smarter. It was more because we got to see and run the whole business in our country earlier. And we had the advantage of not being at headquarters in New York… we could view the strategic issues from a distance, away from the group-think at head office.”
My sixth tip… is never stop learning. I was a history major at university. I liked it… and very occasionally it was even marginally relevant. But for me to have any success in business… I realized I had to move beyond knowing the date of the Battle of Vienna… or even the date of publication of “A Wealth of Nations”.
So I took every course a company wanted to throw at me – New Manager School and Advanced Management School at IBM… Finance for the Non-Financial Manager at Ford… a certificate in marketing from U.C. Berkeley thanks to IBM Canada… a certificate in Investor Relations from the University of Michigan, thanks to CAE… and, most recently a certificate in CSR from St.Michael’s College, U of T… courtesy of Canada Post.
TThese were all relevant courses that tuned me up to address either a change or expansion in responsibilities… or keep me fresh in terms of the latest thinking or trends.
The biggest mistake you can make is to think that once you have a degree -- in commerce or even an MBA -- that you are done. You are never done. Nor should you want to be. An opportunity to learn and grow will keep you fresh fully engaged… and will sustain your career.
My seventh tip is a little like my first two combined. Don’t be afraid to stay with a company for an entire career… but don’t be afraid to move between companies, either. My career has been one of movement. I have typically spent five or six years with a company… and then moved on, to a different industry and to a newly installed CEO.
The up side of this is that I arrive with a great deal of relevant experience and and am able to quickly implement change… and help the CEO find his or her feet in terms of communications, brand and government relations.
My youngest brother, a former McKinsey employee, used to describe the consulting model as “promiscuous”, serving many clients, at once. He described my career path, in contrast, as “serially monogamous”.
Would I recommend this to everyone – to those of you in this room? Maybe. The down side is important to discuss… which is why I say “Don’t be afraid to stay with one company.”
The most important reason you might want to stay… is people.
Whether it was IBM… Ford… CAE… or CIBC… leaving the people behind was the hardest part… and was not done without misgiving. It has been particularly difficult in cases where I have had to physically move… from Boston to Washington… from Washington to New York and then to Toronto… most recent from Toronto to Ottawa. You would have to be a pretty cold fish not to feel a pang or two of regret… when you leave the people who you’ve been in the trenches with.
I say all of this because when I was just starting out… the conventional wisdom was to stick with one company… and “climb the corporate ladder.” Today, it is almost the opposite – jump around as much as you can. My only advice is to ignore the conventional wisdom of the day… whatever it might be… and determine what is best for you. In my care, if I hadn’t been mobile in my career… I never would have come to Canada… met my spouse at Ford in Oakville… become a citizen… and ended up here tonight, giving this speech!
Which leads to my final point, one that I will not number… as you already know it. Fate, or luck, or whatever you call it, will play a role in your career and life. Be open to opportunities you never expected… and be brave enough to embrace them. If you do that, you’ll find you “can get there from here”. If you don’t… the luck will find someone else.
Thank you.
Robert Waite, SVP Corporate Social Responsibility
Canada Post Corporation
Robert E. Waite
